A high-profile lawsuit accusing Elon Musk of manipulating the value of Dogecoin (DOGE) has concluded. Investors who alleged fraud and insider trading by Musk and his company Tesla have decided to withdraw their appeal of the case’s dismissal on August 29.
Investors had also sought sanctions against Musk’s legal team, accusing them of interfering with the appeal by demanding large attorneys’ fees. Musk and Tesla countered with their own motion, accusing the investors’ lawyers of filing a “frivolous” lawsuit based on inconsistent legal theories and aimed at getting a quick payout.
Both sides agreed to drop their lawsuits in a stipulation filed Thursday night in federal court in Manhattan. The agreement, which requires approval by U.S. District Judge Alvin Hellerstein, effectively ends the legal battle.
The lawsuit focused on Musk’s tweets and public statements and actions, including a memorable appearance on NBC’s Saturday Night Live in which he referred to Dogecoin as a “scam.” Investors alleged that Musk timed these events to manipulate the price of Dogecoin for personal gain, causing them financial losses.
But Judge Hellerstein ruled in August that the investors had failed to prove securities fraud. He said Musk’s tweets, including claims that Dogecoin was “the world’s future currency” or that SpaceX could fly it to the moon, were too vague for reasonable investors to trust. The judge also dismissed related market manipulation and insider trading claims, saying he did not understand their basis.
Initially, investors had sought $258 billion in damages and amended their complaints four times in two years.
Elon Musk, who purchased Twitter (now known as X) in 2022, has long been linked to Dogecoin’s rise in popularity. The lawsuit’s conclusion coincides with Musk’s new role as co-chair of the Department of Government Efficiency (DOGE), an initiative launched by President-elect Donald Trump.
*This is not investment advice.